COUNTY GOVERNMENT OF MACHAKOS COUNTY BUDGET REVIEW AND OUTLOOK PAPER September, 2018 FOREWORD Machakos County Budget Review and Outlook Paper (CBROP 2018) was prepared pursuant to Section 118 of the Public Financial Management Act, 2012. This review document focused on the fiscal year ending June 2018 compared with the year on year growth for similar period in previous years. The global outlook revealed a stable macroeconomic variability with a 3.9 percent growth in the GDP supported by increased outputs in most sectors, low inflation, tighter monetary policies and stability of prices of crude oil and associated petroleum products. Locally the County fiscal analysis for FY 2017/2018 revealed a subdued performance in both revenues and expenditure compared to similar period in FY 2016/2017. The County Government is conscious to the Big Four Agenda i.e. food security, affordable housing, universal healthcare and manufacturing. It is worth noting that the County Government of Machakos will play a host to some of the housing units as envisaged in the provision of affordable housing agenda as well being one of the counties selected to pilot the universal healthcare programme. The County expenditure performance revealed a slowdown in budget absorption rate especially on development expenditure from Kshs. 2.3billion in FY 2016/2017 to about Kshs. 1.6billion in FY 2017/2018. In this 2018 CBROP, while re-emphasizing the Government’s economic and development agenda, the County has set consistent expenditure ceilings that take into consideration the projected resource envelope. Departments are therefore called upon to adhere to the sector ceilings and rationalize all programs to ensure that only those programs with the least cost but highest impact on our core objectives of infrastructure development, clean water and quality healthcare services among others are given consideration in resource allocation County Executive Committee Member-Finance and Economic Planning I TABLE OF CONTENTS FOREWORD .................................................................................................................................................... TABLE OF CONTENTS .................................................................................................................................. II LIST OF TABLES ........................................................................................................................................... III LIST OF FIGURES ......................................................................................................................................... III ABBREVIATIONS AND ACRONYMS ........................................................................................................... IV CHAPTER ONE .............................................................................................................................................. 1 1.0 INTRODUCTION ........................................................................................................................... 1 A. Legal Basis for the Preparation and Publication of the County Budget Review and Outlook Paper ..................................................................................................................................................... 1 B. County Government Fiscal Responsibility Principles ................................................................... 2 C. Objectives of the County Budget Review and Outlook Paper ...................................................... 2 CHAPTER TWO ............................................................................................................................................. 4 2.0 REVIEW OF FISCAL PERFORMANCE IN FY 2017/18 .................................................................. 4 (b) 2.1 Fiscal Performance FY 2017/2018 .................................................................................... 4 CHAPTER THREE ......................................................................................................................................... 14 3.0 RECENT ECONOMIC DEVELOPMENTS AND FISCAL OUTLOOK ............................................. 14 3.1 Recent Economic Developments .................................................................................................. 14 3.2 Macroeconomic outlook and policies .......................................................................................... 15 3.3 Medium Term Fiscal Framework............................................................................................ 19 3.4 Risks to the Outlook ................................................................................................................ 20 4.0 RESOURCE ALLOCATION FRAMEWORK ........................................................................................ 21 4.1 Adjustment to the FY 2018/19 Budget ........................................................................................ 21 4.2 Medium Term Expenditure Framework. ..................................................................................... 22 CHAPTER FIVE............................................................................................................................................. 27 CONCLUSION ......................................................................................................................................... 27 ANNEXES ..................................................................................................................................................... 28 Annex 1: County Total Revenue Projections in the Medium Term ....................................................... 28 Annex 2: Own Source Revenue Projections ........................................................................................... 30 Annex 3: Expenditure by Economic Classification in the Medium Term ............................................. 33 Annex 4: Programme Based Expenditure in the Medium Term ............................................................ 39 Annex 5: County Sector Ceilings ............................................................................................................ 44 Annex 6: Machakos County Budget Calendar 2018/19 ....................................................................... 47 Annex 6: County Sector Composition .................................................................................................... 49 II LIST OF TABLES Table 1: Fiscal Out-turn for the FY 2017/2018 (Amounts in Kshs. billion) .................................................. 5 Table 2: County Own Revenue per Source ................................................................................................... 7 Table 3: Exchequer releases .......................................................................................................................... 9 th Table 4: Expenditure Performance by Economic Classification for the Period Ending 30 June, 2018 .... 10 th Table 5: Expenditure Performance for Period Ending 30 June, 2018 per Department (Kshs. in Millions) .................................................................................................................................................................... 11 LIST OF FIGURES Figure 1: County Total Receipts for FY 2017/2018 ........................................................................................ 5 Figure 2: County Total Payments for FY 2017/2018 ...................................................................................... 6 Figure 3: Monthly County Own Source Revenue Performance ..................................................................... 8 Figure 4: Comparative Quarterly Revenue Performance ................................................................................ 8 Figure 5: Comparative County expenditure for FY 2016/17 and 2017/18 (Kshs. In Millions) ............. 12 III ABBREVIATIONS AND ACRONYMS ADP Annual Development Plan AfCFTA African Continental Free Trade Area AU African Union CARA County Allocation Revenue Act CBROP County Budget Review and Outlook Paper CFTA Continental Free Trade Area CFSP County Fiscal Strategy Paper CG County Government CIDP County Integrated Development Plan COFOG Classification of Functions of Government CRF County Revenue Fund DANIDA Danish International Development Agency Dev’t Development ECDE Early Childhood Development Education FIF Facility Improvement Fund FY Financial Year GDP Gross Domestic Product ICT Information Communication Technology IFMIS Integrated Financial Management System IMF International Monetary Fund KCSAP Kenya Climate Smart Agriculture Project KDSP Kenya Devolution Support Program Kshs Kenya Shillings KUSP Kenya Urban Support Project MoDP Ministry of Devolution and Planning MTEF Medium Term Expenditure Framework MTP Medium Term Plan OSR Own Source Revenue PBB Programme Based Budget PFM Public Finance Management Rec. Recurrent RMFLF Road Maintenance Fuel Levy Fund IV CHAPTER ONE 1.0 INTRODUCTION A. Legal Basis for the Preparation and Publication of the County Budget Review and Outlook Paper 1. The County Budget Review and Outlook Paper is prepared in accordance with Section 118 of the Public Financial Management Act, 2012 which requires the County Treasury to prepare and submit County Budget Review and Outlook Paper to the County Executive Committee for approval by 30th September in each financial year. The paper includes: a) Actual fiscal performance in the previous financial year compared to the budget Appropriation for that year; b) Updated economic and financial forecasts with sufficient information to show changes from the forecasts in the most recent County Fiscal strategy paper c) Information on how actual financial performance for the previous financial year may have affected compliance with the fiscal responsibility principles or the financial objectives in the latest County Fiscal strategy paper; and d) The reasons for any deviation from the financial objectives together with proposals to address the deviation and the time estimated to do so. 2. County Executive committee shall consider the County Budget Review and outlook Paper with a view to approving it with or without amendments, not later than fourteen days after its submission. 3. Not later than seven days after the CBROP has been approved by Executive committee, the County Treasury shall: a) Submit the paper to the Budget and appropriation Committee of the County Assembly to be laid before the County assembly; and 1 b) Publish and publicize the paper not later than fifteen days after laying the Paper before County Assembly. B. County Government Fiscal Responsibility Principles In line with chapter 12 of the Constitution of Kenya, Section 107 of the Public Financial Management (PFM) Act, 2012 1. The County Government’s recurrent expenditure shall not exceed the County Government’s total revenue 2. Over the medium term, a minimum of 30% of the County budget shall be allocated to development expenditure 3. The County Government’s expenditure on wages and benefits for public officers shall not exceed a percentage of the County Government revenue as prescribed by the regulations. 4. Over the medium term, the County Government’s borrowings shall be used only for the purpose of financing development expenditure and not for recurrent expenditure. 5. Public debt and obligations shall be maintained at a sustainable level as approved by County Government (CG) 6. Fiscal risks shall be managed prudently 7. A reasonable degree of predictability with respect to the level of tax rates and tax bases shall be maintained, taking into account any tax reforms that may be made in the future C. Objectives of the County Budget Review and Outlook Paper 1. The 2018 CBROP aims to provide a review of the fiscal performance for the FY 2017/2018 and how the outcomes impacted the County’s financial objective and fiscal responsibility principles as envisaged in the PFM Act 2012 and CFSP 2018. This information alongside other emerging issues will provide the basis for revising the current budget FY 2018/19 via supplementary budget proposals. 2. This CBROP therefore, underpins the County fiscal initiatives outlined in CFSP 2018 which include the following; 2 3. Based on the indicative County resource envelope, the CBROP 2018 will also relay the primary sector ceilings for the FY 2019/2020 budget inclusive of indicative projections for the FY 2020/2021 and 2021/2022 MTEF period. These ceilings will set off the budget preparation process for the fiscal year 2019/2020. 4. The paper is organized into four chapters: Chapter II provides a review of fiscal performance in FY 2017/2018 and its implication on the 2018 CFSP financial objectives; Chapter III studies the recent economic developments and the updated National and County macroeconomic outlook; Chapter IV and V contains the proposed sector budget ceilings in the medium term and the Conclusion respectively. 3 CHAPTER TWO 2.0 REVIEW OF FISCAL PERFORMANCE IN FY 2017/18 Overview 1. The fiscal year 2017/18 marked the third year of Programme Based Budgeting (PBB) for all County Government entities as per section 12 of the second schedule of the PFM Act 2012. During the financial year 2017/18 there was a decline in local revenue collection and absorption of both development and recurrent expenditure as compared to similar period in FY 2016/17. 2. During the year under review total County revenue amounted to Kshs. 9.43 Billion against a revised target of Kshs. 10.078 Billion. Total receipts from equitable share of revenue comprised of Kshs. 7.39 Billion (100 per cent percent of the total receipts). Ksh 24.76 Million being conditional allocation for foregone user fee (103 percent), Kshs. 288.00 Million (100 per cent) being conditional allocation for fuel levy fund, Kshs. 383.58 Million (100 per cent) being conditional allocation for level five hospital, Kshs. 30.29 Million received from Donors-DANIDA (100 percent) and local revenue collection amounting to Kshs. 1.084 Billion (72%). 3. In the reporting period the execution of both development and recurrent budget revealed a decline of 1% and 35% respectively and in totality 9% as compared to financial year 2016/17. The County spent a total of Kshs. 8.119 Billion during financial year 2017/18 against a revised target of Kshs. 10.078 Billion representing an execution rate of 81% percent. The recurrent expenditure for the period under review represents 80% of the annual recurrent budget while development expenditure represents 20% of the annual development budget. The absorption of development expenditure was hampered by prolonged electioneering period and delays in disbursement of funds by the exchequer. (b) 2.1 Fiscal Performance FY 2017/2018 2.1.1 Revenue performance 4. Despite a deviation of Kshs. 493 Million from the planned target there was a decline in revenue by 3% in the year under review compared to actual receipt in financial year 2016/17. 4 Table 1: Fiscal Out-turn for the FY 2017/2018 (Amounts in Kshs. billion) Approved Budget Revised Budget 2017/18 2017/18 Actual Total Revenue 9.990 10.078 9.430 National Government transfers 8.290 8.432 8.272 Local Revenue 1.700 1.571 1.084 Unspent Balances B/f FY 2016/17 0 0.0747 0.0747 Total Expenditure 8.119 Recurrent 6.907 6.975 6.523 County Assembly 0.974 0.931 0.710 County Executive 5.933 6.044 5.813 Development 2.761 2.964 1.596 County Assembly 0.241 0.296 0.021 County Executive 2.52 2.668 1.575 5. The County government received Kshs. 9.43billion against the expected Kshs. 10.078billion by the end of the FY 2017/18. This represented 93.6% receipt of funds both from national government and own source revenue. The exchequer releases accounted for a larger portion of receipts at 78% with proceeds from domestic/foreign grants accounting for 1%. This is illustrated in figure1 below. Figure 1: County Total Receipts for FY 2017/2018 Receipts Exchequer 1% 12% 8% Proceeds from 1% Domestic/Foreign Grants Transfer from Other Government Entities 78% County Own Source Receipts CRF Returns 5 6. Total expenditures stood at Kshs. 8.119billion in the period under review with recurrent and development expenditures accounting for Kshs. 6.523billion and 1.596billion respectively. Compensation to employees formed the larger part of expenditures accounting for 57% and acquisition of assets consumed 10% of the expenditure as shown in figure 2 below. Figure 2: County Total Payments for FY 2017/2018 Payments Compensation to employees 10% O&M 21% 57% Transfer to Other Government Units 12% Acquisition of Assets 6 Table 2: County Own Revenue per Source 2017/18 2017/2018 Revised Revenue Stream 2016/2017 Actual 2017/18 Actual Estimates Estimates Land Rates &Debt Clearance Cert 159,763,871.00 213,536,354.19 198,716,645.20 Single Business Permit 170,934,785.00 231,990,447.58 215,121,742.00 182,849,984.00 Quarry 259,851,250.95 347,957,121.42 327,102,072.56 229,729,097.00 Sand Gravel 59,325,245.00 80,091,403.94 71,190,294.00 47,105,372.00 Market Fees 44,321,901.00 62,079,047.72 55,186,281.20 6,707,032.00 Plot/Stall Rent 12,944,381.00 17,473,361.02 15,533,257.00 10,041,599.00 Bus Park/Off Street Parking 79,151,964.00 102,845,653.16 97,982,356.80 43,206,310.00 House Rent 39,198,392.00 54,038,025.39 48,038,070.40 4,864,373.00 Refuse/Conservancy Fee 13,107,496.00 17,693,546.70 15,728,995.20 10,568,554.95 Sign Board & Advertisement Fee 34,898,359.00 47,108,596.85 41,878,030.80 35,807,526.00 Fire Fighting &Ambulance 13,770,961.00 16,525,153.20 15,434,615.00 Management Unit 18,589,144.83 Slaughter House Fees/Livestock 5,530,222.00 7,465,136.07 6,636,266.40 5,511,773.00 Enforcement Management Unit 6,546,259.00 8,836,664.10 7,855,510.80 4,409,065.00 Building Plan Approval 199,972,525.00 267,937,312.05 255,967,030.00 182,938,221.05 Cess 6,928,412.03 9,352,524.84 8,314,094.44 6,228,835.00 Procurement Unit 632,650.00 854,001.58 759,180.00 0.00 Social Services &Sports 2,107,214.00 2,528,656.80 22,000.00 Management Unit 2,844,486.03 Water Sales 391,430.00 528,383.53 469,716.00 157,327.00 Miscellaneous 6,867,460.00 9,270,246.90 8,240,952.00 1,235,437.00 House Loan Repayment 25,176.00 33,984.58 30,211.20 38,100.00 Salary Refunds/Salary Advance 26,278.00 35,472.15 31,533.60 18,125.00 Motor vehicle Registration 56,919.00 76,833.82 68,302.80 109,623.00 Health 91,408,806.00 129,785,404.25 115,690,567.20 73,131,315.00 Liqour 49,323,970.00 66,581,440.62 59,188,764.00 35,807,526.00 Tourism 1,504,955.00 2,031,508.66 1,805,946.00 89,000.00 Weights And Measures 714,062.00 963,898.01 856,874.40 0.00 1,700,000,000. TOTAL 1,259,304,943.98 1,571,446,504.00 1,084,204,845.00 00 Source: Machakos County Financial Statement FY 2017/18 7 7. Total own source revenue collections amounted to Kshs. 1.084 Billion against a revised target of Kshs. 1.571 Billion. This shows a deficit of Kshs. 487 Million of the target for the year under review. Total revenue collections compared to the previous FY 2016/2017 reduced by Kshs. 175 Million. Figure 3: Monthly County Own Source Revenue Performance 2016/17 2017/18 25000000 20000000 15000000 10000000 50000000 0 8. On a month to month basis, local revenue performed better in FY 2016/17 between July and March compared to FY 2017/18 over the same period. However, between April and June of FY 2017/18 local revenue shot up with the best month in April, 2018 raising Kshs. 182million in figure 4 above. Figure 4: Comparative Quarterly Revenue Performance 50000000 45000000 40000000 35000000 30000000 25000000 2016/17 20000000 2017/18 15000000 10000000 50000000 0 Qrt 1 Qrt 2 Qrt 3 Qrt 4 8 9. Even though there was a general decline in the County OSR collections, figure 4 above indicates a significant improvement in the fourth quarter of FY 2017/18 compared to the same period in the 2016/17 FY. Revenue collections in that period rose from Kshs. 298million in 2016/17 FY to Kshs. 449million in FY 2017/18. This was attributed to the streamlining of revenue collections and sealing leakages. The County is thus optimistic that with revenue collection measures put in place it will be able to meet its target in the current FY 2018/19. Table 3: Exchequer releases Revised Targeted Actual Revenue ACTUAL FY Revenue(Kshs) (B) FY Actual FY Variance Variance Stream 2016/17(A) 2017/18 2017/18 ( C) (B-C) (C-A) Equitable 7,398,999,99 Share 7,303,463,454 7,399,000,000 9 1 95,536,545 Level 5 Hospital 365,317,919 383,583,815 383,583,816 (1) 18,265,897 Free (88,707,500 maternity 88,707,500 - - ) DANIDA Grant 13,350,000 30,290,934 30,290,934 - 16,940,934 World Bank 65,588,78 - 95,401,875 29,813,086 9 29,813,086 Devolution KDSP Level 1 - 49,893,169 49,893,169 - 49,893,169 Development of Youth Polytechnics - 65,957,023 65,957,023 - 65,957,023 User Fees foregone 24,764,876 24,129,039 24,764,877 (635,838) 1.00 RMFLF 112,217,668 288,391,503 288,391,504 (1) 176,173,836 Health officers additional (156,588,00 allowance 156,588,000 - - - 0) Coffee cess allocation 6,636,751 - - - (6,636,751) 9 Revised Targeted Actual Revenue ACTUAL FY Revenue(Kshs) (B) FY Actual FY Variance Variance Stream 2016/17(A) 2017/18 2017/18 ( C) (B-C) (C-A) Transforming Health Systems for Universal Care Project - 95,744,681 - - - Total - 8,271,694,40 160,697,6 Exchequers 8,071,046,168 8 200,648,240 8,432,392,039 31 Source: Machakos County Financial Statement FY 2017/18 10. The County received 8.27 Billion from the exchequer against a targeted amount of Kshs. 8.33 Billion. The exchequer release comprise of equitable share of Kshs. 7.39 Billion, Conditional grants of Kshs. 937. 64 Million. There was no conditional fund for free maternity, health officer’s additional allowance and coffee cess allocation during FY 2017/18 as shown in table 3 above. 2.1.2 Expenditure Performance 11. The total expenditure for the FY 2017/18 amounted to Kshs. 8.119 Billion against a target of Kshs. 10.078 Billion indicating a performance of 80.6%. The recurrent budget had the highest absorption of 80% and Development budget of 20%. Absorption in the development expenditure declined by 35%. An in-depth analysis of expenditure indicates that compensation of employees had the highest absorption of 56%. Use of goods, Transfers and other payments accounted for 12%, 10% and 2% respectively of the total expenditure budget while Acquisition of assets, Capital Grants and Other Developments accounted for 10%, 8% and 2% respectively of the total budget as shown in table 4 below. Table 4: Expenditure Performance by Economic Classification for the Period Ending 30th June, 2018 Actual 2016/17 Targets 2017/18 Actual 2017/18 % of Total Economic Item Expenditure (A) (B) (C ) Recurrent Expenditure: Compensation of 4,398,376,032.00 4,613,606,356.00 4,584,272,805 56 employees Use of goods and 1,083,013,274.00 1,115,983,304.00 993,863,062.00 12 Services 10 Actual 2016/17 Targets 2017/18 Actual 2017/18 % of Total Economic Item Expenditure (A) (B) (C ) Transfers to other 803,783,256.00 931,670,184.00 794,814,901.00 10 Government entities Other Grants and 368,389,997.00 349,450,752.00 149,639,058.00 2 Transfers Sub Total 6,653,562,559.00 7,010,710,596.00 6,522,589,826.00 80 Development Expenditure: Acquisition of Assets 1,788,819,132.00 2,053,459,190.00 842,048,077.00 10 Capital Grants to 371,364,953.00 718,347,680.00 582,747,675.00 8 Government Agencies Other Developments 144,411,538.00 296,000,000.00 171,687,473.00 2 Sub Total 2,304,595,623.00 3,067,806,870.00 1,596,483,225.00 20 Total 8,958,158,182.00 10,078,517,466.00 8,119,073,051.00 100 Source: Machakos County Financial Statement FY 2017/18 County Entities Expenditure Analysis 12. Categorization of spending by County entities is shown in the table 5 below. Three County entities recorded more than 50% budget execution rate. The highest absorption was observed in Public Service, ICT & Labor while the lowest was in health and Emergency services. All the entities compensation of employees except County Assembly is through Public Service, ICT & Labor; this explains the highest absorption rate of 943%. Table 5: Expenditure Performance for Period Ending 30th June, 2018 per Department (Kshs. in Millions) Recurrent Expenditure Development Expenditure Total Expenditure Rate of Rate of Rate of County Entities Actual Target Budget Actual Target Budget Actual T arget(F Budget (A) (B) Executi (C ) (D) Executi (E ) ) Executi on on on Office Of The 368.39 585.93 63 13.32 22.13 60 381.71 608.06 63 Governor Public Service, ICT 4,547. 4,553. 468.08 971 6.21 14.68 42 482.76 943 & Labour 01 22 Trade, Economic Planning And 33.23 81.38 41 0.45 21.97 2 33.68 103.35 33 Industrialization Finance And Revenue 73.49 352.14 21 12.37 22.5 55 85.86 374.64 23 Management Decentralized Units, County Administration, 124 457.47 27 41.31 54.7 76 165.31 512.17 32 Environment & Solid Waste 11 Recurrent Expenditure Development Expenditure Total Expenditure Rate of Rate of Rate of County Entities Actual Target Budget Actual Target Budget Actual T arget(F Budget (A) (B) Executi (C ) (D) Executi (E ) ) Executi on on on Management Agriculture, Livestock, 66.54 426.43 16 199.04 431.19 46 265.58 857.62 31 Fisheries, Water & Irrigation Health And 3,000. 3,881.7 Emergency 390.86 9 159.78 881.6 18 550.64 11 12 2 Services Transport, Roads, 1130.9 1,198. 1171.8 1,449.5 Public Works And 40.9 251.26 16 43 38 7 29 7 5 Housing. Education, Youth 59.59 251.89 24 7.54 16.47 46 67.13 268.36 25 And Social Welfare Lands, Urban Development, 28.11 86.99 32 40.42 83.39 48 68.53 170.38 40 Energy & Natural Resources Tourism, Culture , Sports & Co- 27.61 76.38 36 9.62 24.89 39 37.23 101.27 37 Operative Development County Public 6.72 41.01 16 0 6.72 41.01 16 Service Board - - 1,227.6 County Assembly 710.39 931.67 76 21.2 296 7 731.59 60 7 6,476. 7,010. 1,642. 3,067. 8,119. 10,078. TOTAL 94% 49% 81% 84 75 23 81 07 56 Source: Machakos County Financial Statement FY 2017/18 13. It is noted that tables 4 and 5 give different expenditures in both recurrent and development. This is attributed to the fact that some departments implement projects and programmes that requires some of the compensation to employees be budgeted for under the development vote due to project staff. Figure 5: Comparative County expenditure for FY 2016/17 and 2017/18 (Kshs. In Millions) 7000 6000 5000 4000 2016/17 3000 2017/18 2000 1000 0 Recurrent Development 12 Source: Machakos County Financial Statement FY 2017/18 14. There was a slight decline in total expenditure by 9.4% from Kshs. 8.958billion in FY 2016/17 to Kshs. 8.119billion in FY 2017/18. This has already been explained as having been attributed to the prolonged elections that curtailed general spending. Recurrent and development declined by 2.7% and 28.7% respectively. 15. During the reporting period, a supplementary budget was undertaken that was meant to spur infrastructural projects. However, delays in approval of the same coupled by slow and lengthy procurement procedures were sighted as the major setbacks in the low expenditure absorption. 13 CHAPTER THREE 3.0 RECENT ECONOMIC DEVELOPMENTS AND FISCAL OUTLOOK 16. The economic performance of the County is dependent on the formulation and implementation of sound policies by both the National and County Government. 3.1 Recent Economic Developments 17. During the period under review the transport sector in the County has improved greatly through construction and upgrading of access roads, major roads and dualing of the Mombasa road stretch between Athi-River and Kyumbi as well as the completion and operationalization of the Standard Gauge Railway. This in turn has led to improved accessibility to health centers, market places and movement of people, goods and services hence improving economic activities. 18. Significant efforts have been made to boost the agricultural sector which is the main economic stay of the County. These efforts include; fueling of tractors for free service to farmers, provision of extension services and supply of subsidized seeds and fertilizer to farmers. This has led to improved production in the agriculture sector. 19. To spur development in our urban centres, through the Kenya Urban Support Program, the County has established Municipal Boards in Machakos, Mavoko and Kangundo – Tala. These municipalities will be charged with the responsibility of promoting development along five key investment areas, i.e. waste management (solid and liquid), storm water drainage, connectivity (roads and street lights), urban social and economic development (markets, bus parks and slaughter houses) and fire and disaster management. 20. Emerging investments in Mavoko Sub County along the Mombasa road corridor and other areas within the County has contributed to the growth of industrial and trade sector and creation of employment in the County. 14 3.2 Macroeconomic outlook and policies 3.2.1 Global Economic Outlook 21. Global growth is projected to reach 3.9 percent in 2018 and 2019 as forecasted in the April 2018 World Economic Outlook report, but the expansion is becoming less even, and risks are mounting. The rate of expansion appears to have peaked in some major economies and growth has become less synchronized. 22. Among emerging market and developing economies, growth prospects are also becoming more uneven, amid rising oil prices, higher yields in the United States, escalating trade tensions, and market pressures on the currencies of some economies with weaker fundamentals. 3.2.2 Sub Saharan Africa Economic Outlook 23. The recovery in Sub-Saharan Africa is set to continue, supported by the rise in commodity prices. For the region, growth is expected to increase from 2.8 percent in 2017 to 3.4 percent this year, rising further to 3.8 percent in 2019 (IMF). This would mark best result since 2014 if confirmed. While the economy is on a more solid trajectory after growth fell to an over two-decade low in 2016, challenges to the outlook remain. Poor infrastructure and weak business climates as well as relatively small private sectors are limiting the strength of the recovery. In addition, several economies are burdened with large debt, while security concerns continue to plague investment and cast a shadow on the regional outlook. 24. The African Continental Free Trade Area (AfCFTA) is an ambitious initiative to form a continental common market to boost intra-Africa trade from the current 16 per cent to 52 per cent by 2022. This will be achieved by providing a comprehensive and mutually beneficial trade agreement among the member states, covering trade in goods and services, investment, intellectual property rights and competition policy. The CFTA is a flagship project of Agenda 2063 and refers to a continental geographic zone where goods and services move among member states of the African Union (AU) with no restrictions. It is therefore a potential tool for driving industrialization, economic diversification and development. 25. The Continental Free Trade Area (CFTA) will create a wider single market of more than 1.2 billion people with a combined GDP of $2.19 trillion for goods and services across 15 the continent. This will bring benefits for businesses and consumers and strengthen Africa’s position in world trade by inducing investments, resulting in the pooling of African resources to enhance structural transformation and the development of regional value chains. It will also create the “fiscal space” to foster public and private investment, while ensuring economic diversification with a view to creating jobs. 26. At least 44 countries signed the CFTA in early 2018 underscoring their commitment to the project. Kenya and Ghana handed over to the African Union Commission the documents ratifying the continental free trade in May 2018. The benefits to participating African countries will include; 27. The project however also risks causing tariff revenue losses, leading to “holes” in national budgets. The impact on taxes applied to imported and exported goods, however, would be small and gradual and the tariff revenue losses might be outweighed by the additional revenues from growth to be generated by CFTA. 3.2.3 East African Community Economic Outlook 28. Growth depends, among other factors, on a stable macroeconomic environment. Low inflation and stable, optimal exchange and interest rates, crucial to macroeconomic stability, have preoccupied policy makers (especially central banks) in East Africa. Price movements 29. Inflation dynamics: In 2016, inflation in the region stood at 13.1 percent, and in 2017 at 14.4 percent. The double-digit regional average inflation rates have been largely driven by Sudan’s inflation and, to some degree after 2016, Burundi’s. At these rates, East African inflation has been the highest on the continent. However, the region’s inflation is expected to slow to single digits at 8.9 percent in 2018 and 7.8 percent in 2019. 30. Exchange rate evolution: The region’s inflation and exchange rates in 2017 show success in attaining macroeconomic stability. In Kenya, the region’s dominant and sophisticated economy, the shilling remained stable in the range of KSh100–104/$ in 2017. 31. Domestic resource mobilization: The fiscal deficit across the region’s countries results partly from weak domestic resource mobilization, the case throughout 2015–17. With 16 the average regional domestic saving at 12.8 percent of GDP and the investment-to- GDP ratio at 24.2 percent, the domestic resource gap in 2017 stood at about 11 percentage points 32. Debt: Shifting external financing toward nontraditional partners, particularly China, could aggravate indebtedness, because the cost is high. Also, some countries have begun borrowing through the international bond market, also an expensive course that could raise debt stress further. 3.2.4 Domestic Economy Outlook 33. Available data signals that the economy remained in sound shape at the beginning of the third quarter of the 2017/2018 FY. Growth is being supported by higher confidence after the end of a prolonged election cycle. The current account has improved on healthy agricultural exports, rising transfer inflows and lower capital goods imports following the completion of the Mombasa-Nairobi phase one of the Standard Gauge Railway project. Sturdy growth, within-target inflation and a strengthening external position have kept the shilling firm, enabling the Central Bank to pursue a more accommodative monetary policy aimed at boosting economic activity. 34. Solid growth is expected this year, due to healthy expansions in private consumption and investment amid more favorable credit conditions. A continued upturn in the agricultural sector, aided by improved weather conditions, should also support growth. Moreover, rising investor confidence should attract a greater inflow of foreign investment into the economy. That said, the Government’s fiscal consolidation plans could curb the pace of expansion. 35. On the downside however, the debt-to-GDP ratio has continued to increase over the past three years. Currently, it stands at about 56 percent, which is higher than the 2010–2014 average of 45 percent and the 2015–2016 average of 52 percent. This could be burdensome in relation to the County’s potential to repay the loans. 3.2.5 County’s Economic Outlook 36. Analysis of the revenue figures shows that the trend of building plans approvals has declined. This can be explained by the fact that over the years, the County has 17 witnessed many upcoming building developments in major towns and this has reached saturation levels. 37. The revenue policy to exempt mama mbogas from paying market fees that was introduced by H.E. Dr. Alfred Mutua through his 2018 – 2022 manifesto has improved the economic welfare of this group of small scale market traders. Moving forward, this policy is likely to attract more participation in the business and empowerment of women since they form the majority of small scale market traders. 38. With the national launch of the Big four agenda, the County has aligned its operations and activities along achievement of these targets across the four agenda as follows; 39. Food security: The County has experienced favorable weather conditions coupled with the County Government’s initiatives have led to improved food security situation. The County will continue to heavily invest in key sectors like water/ irrigation and agriculture and cooperatives in availing appropriate programs that would ensure sustained food security and nutrition. 40. Manufacturing: The existence of Export Processing Zone, establishment of other manufacturing industries in Mavoko has led to employment creation. 41. Affordable Housing: Mavoko area has been selected by the National Government for project for the affordable housing flagship program. 42. Universal Healthcare program: This is set to be launched in the second quarter of 2018/19 FY as part of a pilot program in collaboration with the national Government and the World Bank. About 1.3 million of Machakos residents are set to benefit from the program. This will lead to a healthy and productive society. 43. The County is witnessing a renewed fight against corruption that is aimed at reducing wastage and embezzlement of public resources. This will improve service deliver and create confidence among investors. 18 44. According to a survey conducted by the Institute of Economic Affairs around August 2018, Machakos is ranked as the most ideal investment hub in Kenya hence boosting economic growth. 3.3 Medium Term Fiscal Framework 45. The County Government has prepared a County Integrated Development Plan II (CIDP) 2018-2022 that will guide planning and budgeting for the next five years. The CIDP preparation process was participatory, consultative and captured inputs from the relevant stakeholders and citizen views through public participation forums in all the forty wards. The CIDP was prepared as per the new guidelines issued by the Ministry of Devolution and Planning (MoDP). 46. The County Government has several conditional grants from the World Bank/National Government which include the Kenya Devolution Support Programme (KDSP), Kenya Urban Support Programme, leasing of medical equipment, operation of level 5 hospitals, road maintenance fuel levy, rehabilitation of village polytechnics and compensation of user fee forgone. 47. KDSP supports capacity building activities in five Key Result Areas (KRA) namely; Public Finance Management, Planning and Monitoring and Evaluation, Human Resources and Performance Management, Civic Education and Public Participation and Investment implementation and Social and Environmental Performance. 48. The County Government will continue to focus on capacity building for the youth through rehabilitation of village polytechnics. These will fill the technical skills gap required by industries within the County as well as promoting self-employment and innovation among the youth. 49. The National Government, through the National Treasury, has prepared a draft policy on Enhancement of County Governments Own-Source Revenue. The Policy proposes a standardized framework (institutional, policy and legal) for own source revenue raising measures and enforcement. It also proposes measures to broaden the Counties’ revenue bases and enhance revenue administration capacity. This Policy has been triggered by key five concerns which are: 19 i. The smallness of Counties’ Own-Source Revenue and its diminishing share vis-à-vis total resources; ii. The manner in which Counties plan and budget for local revenue; iii. Legal questions relating to some revenue-raising measures; iv. The short- and long-term fiscal and macroeconomic ramifications of the measures; and, v. Utilization of collections as well as reporting and accounting procedures. Underlying these concerns is the question about how each County can optimize its Own Source Revenue within the existing rules of Public Finance Management (PFM). 3.4 Risks to the Outlook Low local revenue inflow 50. Low revenue inflow has a negative impact on the economic activities at the County resulting to slow economic growth. The County has 26 revenue streams but only 7 contribute significantly in revenue collection. These are building plans, quarries, land rates, bus parks and Single Business Permits. Quarries and sand are being depleted overtime which may adversely affect amount of revenue collected. Delay in Disbursements 51. Delays in disbursements of funds by the national Government will be another challenge as this will lead to disruptions in implementing programs. Public expenditure pressures 52. Public expenditure pressures especially recurrent expenditures pose fiscal risks to the future economic performance of the County. With the commitment to improve infrastructure within the County e.g. roads and water, there is need to put strategies in place to manage recurrent expenditures. Erratic weather patterns 53. Over the years the County has experienced erratic weather patterns that normally affect agriculture productivity which has led to poor economic performance and depressed livelihood. 20 CHAPTER FOUR 4.0 RESOURCE ALLOCATION FRAMEWORK 54. This section establishes the resource envelope the County expects and how it will be allocated across all the sectors for 2018/19 FY and in the medium term. 4.1 Adjustment to the FY 2018/19 Budget A. The FY 2017/18 Budget sought to consolidate the gains made by the County Government in the last four years as it even continues to pursue the transformative agenda it started for inclusive economic growth. B. Given the performance in 2017/18 budget and the updated fiscal outlook, the risks to the FY 2018/19 budget include lack of realization of the projected local revenue which will hinder the full implementation of the budget, expenditure pressures with respect to remuneration of employees and the absorption rate by the different sectors especially for development expenditure .The County Government will however monitor these risks with an aim of mitigating them to ensure there is proper and prudent use of resources over the medium term. C. Any adjustments to the FY 2018/19 budget will take into account actual performance of expenditure so far and absorption capacity in the remainder of the financial year because of the resource constrains. Further, to reduce unnecessary pressure on expenditures, the County Government will institute measures aimed at reducing unnecessary expenses and introduce controls which will ensure adherence to the approved budget allocations. Regular monitoring and evaluation will also be carried out to identify slow or non performing programmes in order to allocate resources accordingly. D. Any review of salaries and benefits for the personnel will be guided by the Salaries and Remuneration Commission. E. On the Revenue side, the County Treasury is expected to institute corrective measures to curb the revenue leakages with an aim of ensuring revenue targets are met in order 21 to fund the various programmes. Some of the strategies directed towards achieving this include establishment of a revenue unit, continuous automation of the revenue system, continuous mapping of the available revenue streams, revenue target setting and monitoring and sensitizing all citizens on the benefits of paying County rents, rates and fees. 4.2 Medium Term Expenditure Framework. 55. This subsection explains adjustment that will be made to the budget over the immediate and the following two years. The County will continue to implement the medium term expenditure framework (MTEF) through policies, projects, and programs set out in the annual development plan and County fiscal strategy paper as anchored in the County integrated development plan. 56. The County will continue to invest in good governance, creation of employment, improved infrastructure, access to clean water for both domestic and commercial use, quality and affordable universal health care, education, urban planning and development among others. 57. The medium term budget frame work for the FY 2018/19-2020/21 ensures continuity in resource allocation based on prioritized programmes. The allocation of resources in the medium term will be based on; i. PFM Act, 2012 principles ii. Ongoing projects iii. Emerging priorities iv. Programmes prioritized in the Second County Integrated Development Plan (CIDP) v. Cost effectiveness and sustainability of the programmes vi. Budget ceilings allocated by the Commission of Revenue Allocation vii. Equitable share of revenue allocation from the National Government viii. Degree to which the programmes address the strategic objectives of the County. ix. Degree to which the programmes are addressing the core function and responsibilities of the ministry. x. Goals and the objectives of the country and the Vision 2030 blueprint. xi. The Big Four 22 58. The resource allocation framework therefore, continues to be aligned to development programmes that target the following areas; i. Improvement of Infrastructure Infrastructure is essential for a successful conducive business environment. In a global economy where economic opportunities have been increasingly related to the mobility of people, goods and information, a strong relationship appears between the quantity and quality of transport infrastructure and the level of economic development. When the transport systems are efficient, they result in positive multiplier effects such as better accessibility to markets, employment, additional investments and reduced costs in many economic sectors. During the FY 2018/19 resources will be set aside to develop and effectively manage a sufficient and robust quality road system that will require minimum maintenance. ii. Access to Clean Water Access to clean water and proper sanitation is vital for enhancing prosperity, sustainable development and poverty eradication. To ensure access to clean drinking water and basic levels of sanitation for all residents of Machakos County, the implementation of the ongoing comprehensive water program will be fast tracked. This will ensure that the drilling and equipping of boreholes, construction of new dams and water pans as well as refurbishing and desilting existing ones and distribution of elevated tanks are done within the stipulated time frames. iii. Access to Quality Health Care Services. Access to quality healthcare is critical. The County Government will invest in improving the quality of healthcare services provided to the citizens of Machakos County and eliminate health disparities through quality care for all through completion and equipping of community hospitals and refurbishment of level 3 and 4 hospitals iv. Sustainable Environmental Conservation The County Government has taken a proactive leadership role in environmental protection and conservation. Environmental protection and conservation is vital 23 towards climate change mitigation and adaptation. In the FY 2018/19 the following programmes will be implemented: i. Purchase of tree seedlings and tree planting activities ii. Purchase of solid waste management equipment iii. Establish tree nurseries to be distributed to farmers at subsidized prices. v. Revenue Management and Enhancement The ability of the County Government of Machakos to provide the required services depends on revenue availability from the National Government disbursements and locally raised sources. In the FY 2017/18, resources have been set aside to develop an innovative, effective and efficient revenue collection system to enable the attainment of revenue targets. This will be done through expanding the revenue base and enforcing strict control measures to ensure minimal revenue leakages. vi. Creating Conducive Business Environment Reducing the cost of doing business and improving security in Machakos County are essential towards encouraging investments, enhancing economic growth and promoting employment creation. The County Government will invest in: a) Promotion of fair trade practices through calibration and verification of weight and measures equipment and ensuring consumer awareness b) Formulation and implementation of sound economic policies c) Conducting feasibility studies to determine viability of new industries d) Promotion of private sector development through enterprise and entrepreneurship development e) Promotion of the informal sector through the construction of Jua Kali sheds. f) Periodic monitoring & evaluation of projects and programmes vii. Promotion of sustainable agriculture The Agriculture Sector plays a key role in accelerating economic growth through enhancing food security; income generation; employment and wealth creation. The sector also contributes 24 significantly to socio-economic growth and development through forward and backward linkages with other priority sectors of the economy. 59. During the FY 2018/19 and in the medium term, the sector will continue to implement policies aimed at cushioning the agriculture sector and ensuring food security. This includes subsidies, construction of fruit processing plant, construction of Dairy processing plant, construction of slaughter houses, rehabilitation of existing cattle dips, pasture development , provision of feeds, fruit seedlings and seeds to farmers , provision of indigenous chicks to farmers, artificial insemination, acquisition of motor vehicles and motor bikes to support extension services to farmers across the County, improvement of Fish farming by increasing the number of fingerlings to farmers, acquisition of additional tractors and promotion of drip irrigation as part of climate resilience interventions. viii. Improving Education Education is a fundamental factor in development of a country. To improve the education sector, the County Government will implement the following programmes: i. Disbursement of bursaries to the bright and needy students across the County ii. Construction of additional Youth Polytechnics and Technical Skills Training Schools. iii. Carrying out vocational training iv. Construction on libraries to inculcate reading culture within the County v. Recruitment of additional ECDE teachers vi. School Feeding Program to enhance retention Approved Budget FY 2018/19 60. In the FY 2018/19, the County Assembly has approved a budget amounting to Kshs. 12.23 billion out of which Kshs. 7.63 billion and Ksh.4.60b are recurrent and development expenditures respectively. 25 Revenues FY 2018/19 61. The FY 2018/19 budget targets a total of Ksh 12.23 billion of which of 1.72 billion will be from own source revenue collection and Ksh 10.51 billion from National Government. The performance of the local revenue will be underpinned by the measures that have been put in place to enhance revenue collection and the Finance Act, 2018 when enacted. The various sources of the revenue from the County own revenue and national Government are as per annex 1 and 2 respectively. 26 CHAPTER FIVE CONCLUSION 62. The implications of 2017/18 budget implementation are that in comparison with the previous period, there was notable decline in absorption rates especially in development vote. Own source revenue also declined by 14%. With the various revenue measures put in place, it is envisaged that the County will realize its target for the FY 2018/19. 63. Going forward the County shall embark on the preparation of the sectoral departmental strategic plans which shall complement the ADP and CIDP for an integrated resource allocation to sector projects that result in “quick-wins” and widespread impacts. Moreover, in entrenching fiscal discipline, the County Government has continued to rely on the fiscal responsibility principles set out in the PFM Act 2012 in making forecasts realistic and reasonable. The County Government has also continued to pursue prudent fiscal policy through reorienting expenditure toward priority programmes within the mandate given. The next County Fiscal Strategy Paper due in February 2019, shall firm up the baseline expenditure ceilings proposed in this CBROP document. 64. Finally there is need to undertake impact evaluation in order to assess if higher rate of project implementation translates into realization of County goals and objectives. 27 ANNEXES Annex 1: County Total Revenue Projections in the Medium Term Printed Projected Actual S/No Description Estimates 2017/18 2019/2020 2020/2021 2018/19 (Kshs) 1 Equitable Share 7,398,999,999 8,321,000,000 8,737,050,000 9,173,902,500 Level Five 383,583,816 383,583,815 402,763,006 422,901,156 Hospital Compensation for user fees 24,764,877 24,129,039 25,335,491 26,602,265 foregone Leasing of medical 29,813,086 210,000,000 220,500,000 200,000,000 equipment Rehabilitation of Youth 65,957,023 57,009,750 59,860,238 54,295,000 Polytechnics Road Maintenance 288,391,504 219,084,683 230,038,917 241,540,863 Levy Fund Kenya Climate Smart Conditional 2 Agriculture - 122,850,000 128,992,500 Grants/Loans 117,000,000 Project (KCSAP) Kenya Devolution Support 49,893,169 53,423,784 56,094,973 58,899,722 Project (KDSP) – level 1 Kenya Urban Support - 1,018,320,500 1,069,236,525 1,122,698,351 Project (KUSP) Universal Healthcare in 30,290,934 24,806,250 26,046,563 27,348,891 Devolved System 28 Printed Projected Actual S/No Description Estimates 2017/18 2019/2020 2020/2021 2018/19 (Kshs) Program Transforming Health Systems for - 95,401,875 100,171,969 105,180,567 Universal Care Project Unspent 74,678,925 - - - Funds 3 Own Source Revenue 1,084,204,845 1,720,061,674 1,806,064,758 1,896,367,996 Total County Allocation 9,430,578,178 12,231,106,620 12,842,661,951 13,484,795,049 29 Annex 2: Own Source Revenue Projections Printed Revised Projected Estimates Estimates Estimates 2017/18 2018/19 2019/2020 2020/2021 Revenue Stream 2017/18 2017/2018 Actual Estimates Land Rates &Debt Clearance 1 8 8 , 1 9 4 , 0 3 5 Cert 215,712,054 191,716,645 218,212,495 229,123,120 240,579,276 Single Business 182,849,984 Permit 230,771,448 205,121,742 233,469,567 245,143,045 257,400,197 Quarry 350,768,007 311,821,501 229,729,097 354,915,233 372,660,994 391,294,044 Sand Gravel 42,378,339 37,664,590 47,105,372.00 81,058,793 85,111,732 89,367,319 Market Fees 59,829,248 53,186,281 6,707,032.00 60,536,625 63,563,457 66,741,629 Plot/Stall Rent 17,370,257 15,441,601 10,041,599.00 17,575,630 18,454,412 19,377,133 Bus Park/Off 43,206,310.00 Street Parking 89,856,294 79,879,362 108,108,919 113,514,364 119,190,083 House Rent 52,913,125 47,038,070 4,864,373.00 53,538,732 56,215,668 59,026,452 Refuse/Conserva 10,568,554.95 ncy Fee 17,693,547 15,728,995 17,902,742 18,797,879 19,737,773 Sign Board & Advertisement 3 5 ,8 0 7 , 5 2 6 . 0 0 Fee 47,108,597 41,878,031 47,665,575 50,048,853 52,551,296 Fire Fighting &Ambulance 15,434,615.00 Management Unit 18,589,145 16,525,153 18,808,929 19,749,376 20,736,845 Slaughter House 5,511,773.00 Fees/Livestock 7,465,136 6,636,266 7,553,398 7,931,068 8,327,622 Court Fines 220,192 195,744 - 222,796 233,936 245,632 30 Printed Revised Projected Estimates Estimates Estimates 2017/18 2018/19 2019/2020 2020/2021 Revenue Stream 2017/18 2017/2018 Actual Estimates Enforcement Management 4 ,4 0 9 , 0 6 5 . 0 0 Unit 8,616,472 7,659,767 8,718,347 9,154,264 9,611,977 Off-Street Parking Unit 16,989,359 15,102,995 - - - - Building Plan 182,938,221.0 Approval 269,938,912 239,967,030 5 273,142,474 286,799,597 301,139,577 Cess 9,352,525 8,314,094 6,228,835.00 9,463,102 9,936,257 10,433,070 Procurement Unit 854,002 759,180 - 864,099 907,304 952,669 Social Services &Sports 22,000.00 Management Unit 2,844,486 2,528,657 2,878,117 3,022,023 3,173,124 Water Sales 528,384 469,716 157,327.00 534,631 561,362 589,430 Miscellaneous 9,270,247 8,240,952 1,235,437.00 9,379,852 9,848,844 10,341,286 House Loan 38,100.00 Repayment 33,985 30,211 34,386 36,106 37,911 Salary Refunds/Salary 1 8 , 1 2 5 . 0 0 Advance 35,472 31,534 35,892 37,686 39,570 Motor vehicle 109,623.00 Registration 76,834 68,303 77,742 81,629 85,711 Interest On Plots/Stall Rent 103,104 91,656 - 104,323 109,539 115,016 31 Printed Revised Projected Estimates Estimates Estimates 2017/18 2018/19 2019/2020 2020/2021 Revenue Stream 2017/18 2017/2018 Actual Estimates Health 123,390,919 109,690,567 73,131,315.00 124,849,804 131,092,294 137,646,908 Liquor 66,581,441 59,188,764 35,807,526.00 67,378,651 70,747,584 74,284,963 Tourism 2,031,509 1,805,946 89,000.00 2,055,528 2,158,304 2,266,219 Weights And Measures 963,898 856,874 - 975,294 1,024,059 1,075,262 Machakos County Sand Harvesting 37,713,065 33,525,704 - - - - TOTAL 1,700,000,000 1,511,165,933 1,084,204,845 1,720,061,674 1,806,064,758 1,896,367,996 32 Annex 3: Expenditure by Economic Classification in the Medium Term i. Recurrent Approved Projected Estimates Printed Estimates Expenditure County Entity Details 2018/19 2019/2020 2020/21 2017/18 Compensation 196,475,466.00 226,634,132.00 237,965,838.60 249,864,130.53 to Employees Use of goods Office of the 348,050,575.00 325,664,258.00 341,947,470.90 359,044,844.45 and services Governor Other Current 41,400,000.00 53,420,306.00 56,091,321.30 58,895,887.37 Transfers Total 585,926,041.00 605,718,696.00 636,004,630.80 667,804,862.34 Compensation 151,443,252.00 153,443,252.00 161,115,414.60 169,171,185.33 to Employees Use of goods Public Service 287,666,679.00 279,792,707.00 293,782,342.35 308,471,459.47 and services Labour and ICT Other Current 68,132,770.00 500,000.00 525,000.00 551,250.00 Transfers Total 507,242,701.00 433,735,959.00 455,422,756.95 478,193,894.80 Compensation 52,174,381.00 56,820,100.00 59,661,105.00 62,644,160.25 Trade, to Employees Economic Use of goods 17,959,817.00 75,790,500.00 79,580,025.00 83,559,026.25 Planning and and services Industrialization Other Current 42,750,000.00 2,500,000.00 2,625,000.00 2,756,250.00 Transfers 33 Approved Projected Estimates Printed Estimates Expenditure County Entity Details 2018/19 2019/2020 2020/21 2017/18 Total 112,884,198.00 135,110,600.00 141,866,130.00 148,959,436.50 Compensation 284,908,015.00 286,051,241.00 300,353,803.05 315,371,493.20 Finance and to Employees Revenue Use of goods 67,233,931.00 107,890,027.00 113,284,528.35 118,948,754.77 Management and services Total 352,141,946.00 393,941,268.00 413,638,331.40 434,320,247.97 Compensation Decentralized 376,175,972.00 281,523,441.00 295,599,613.05 310,379,593.70 to Employees Units, County Use of goods Administration, 106,098,034.00 89,310,000.00 93,775,500.00 98,464,275.00 and services Environment Other Current and Solid Waste 4,000,000.00 4,200,000.00 4,410,000.00 Transfers - Management Total 482,274,006.00 374,833,441.00 393,575,113.05 413,253,868.70 Compensation Agriculture, to Employees 348,294,346.00 375,261,884.00 394,024,978.20 413,726,227.11 Livestock, Use of goods Fisheries, Water 106,094,047.00 127,371,089.00 133,739,643.45 140,426,625.62 and services and Irrigation Total 454,388,393.00 502,632,973.00 527,764,621.65 554,152,852.73 Compensation Health Services to Employees 2,700,121,503.00 2,789,681,364.00 2,929,165,432.20 3,075,623,703.81 and Emergency Use of goods Services and services 200,000,000.00 353,686,000.00 371,370,300.00 389,938,815.00 Other Current 34 Approved Projected Estimates Printed Estimates Expenditure County Entity Details 2018/19 2019/2020 2020/21 2017/18 Transfers 20,000,000.00 402,000,000.00 422,100,000.00 443,205,000.00 Total 2,920,121,503.00 3,545,367,364.00 3,722,635,732.20 3,908,767,518.81 Compensation Transport, to Employees 177,220,412.00 137,284,375.00 144,148,593.75 151,356,023.44 Roads, Public Use of goods Works and 41,043,213.00 49,813,408.00 52,304,078.40 54,919,282.32 and services Housing Total 218,263,625.00 187,097,783.00 196,452,672.15 206,275,305.76 Compensation to Employees 84,313,800.00 79,261,490.00 83,224,564.50 87,385,792.73 Education, Use of goods Youth and and services 17,263,034.00 20,460,000.00 21,483,000.00 22,557,150.00 Social Welfare Other Current Transfers 84,111,778.00 195,500,000.00 205,275,000.00 215,538,750.00 Total 185,688,612.00 295,221,490.00 309,982,564.50 325,481,692.73 Compensation Land, Urban to Employees 55,992,145.00 62,057,961.00 65,160,859.05 68,418,902.00 Development, Use of goods Energy and and services 34,996,593.00 35,142,377.00 36,899,495.85 38,744,470.64 Natural Resources Total 90,988,738.00 97,200,338.00 102,060,354.90 107,163,372.65 Tourism, Compensation Culture, Sports to Employees 53,327,869.00 55,994,263.00 58,793,976.15 61,733,674.96 and Co- Use of goods 35 Approved Projected Estimates Printed Estimates Expenditure County Entity Details 2018/19 2019/2020 2020/21 2017/18 operative and services 17,719,500.00 20,101,239.00 21,106,300.95 22,161,616.00 Development Other Current Transfers 5,280,500.00 5,174,160.00 5,432,868.00 5,704,511.40 Total 76,327,869.00 81,269,662.00 85,333,145.10 89,599,802.36 Compensation to Employees 33,011,797.00 31,895,584.00 33,490,363.20 35,164,881.36 County Public Use of goods Service Board and services 8,000,000.00 9,502,200.00 9,977,310.00 10,476,175.50 Total 41,011,797.00 41,397,784.00 43,467,673.20 45,641,056.86 Compensation to Employees 549,564,903.00 412,335,858.00 432,952,650.90 454,600,283.45 Use of goods County and services 330,105,281.00 439,440,481.00 461,412,505.05 484,483,130.30 Assembly Other Current Transfers 95,000,000.00 85,000,000.00 89,250,000.00 93,712,500.00 Total 974,670,184 936,776,339 983,615,155.95 1,032,795,913.75 Total Compensation to Employees 5,063,023,861 4,948,244,945.00 5,195,657,192.25 5,455,440,051.86 Total Net Use of goods and 1,582,230,704 1,933,964,286 2,030,662,500.30 2,132,195,625.32 services Total Net Other Current 356,675,048 748,094,466 785,499,189.30 824,774,148.77 Transfers TOTAL NET EXPENDITURE 7,001,929,613 7,630,303,697 8,011,818,881.85 8,412,409,825.94 36 ii. Development Approved Estimates Projected Estimates Details Expenditure 2018/19 2019/20 2020/21 County Entity 2017/18 Acquisition of Non- Office of the 7,166,250 7,524,563 Financial Assets 22,500,000 6,825,000 Governor Total Development 22,500,000 6,825,000 7,166,250 7,524,563 Acquisition of Non- 20,700,000 12,700,000 13,335,000 14,001,750 Financial Assets Public Service Other Capital Grants and Labour and ICT 0 0 0 0 Transfers Total Development 20,700,000 12,700,000 13,335,000 14,001,750 Trade, Acquisition of Non- 45,950,000 91,575,000 96,153,750 100,961,438 Economic Financial Assets Planning and Other Capital Grants and 683,265,785 0 0 0 Industrializatio Transfers n Total Development 729,215,785 91,575,000 96,153,750 100,961,438 Acquisition of Non- 22,500,000 11,801,000 12,391,050 13,010,603 Finance and Financial Assets Revenue Other Capital Grants and 0 0 0 0 Management Transfers Total Development 22,500,000 11,801,000 12,391,050 13,010,603 Decentralized Acquisition of Non- 39,708,931 31,000,000 5,250,000 5,512,500 Units, County Financial Assets Administration, Other Capital Grants and Environment 0 0 0 0 Transfers and Solid Waste Management Total Development 39,708,931 31,000,000 5,250,000 5,512,500 Acquisition of Non- Agriculture, 227,188,894 665,611,142 698,891,710 733,836,284 Financial Assets Livestock, Other Capital Grants and Fisheries, Water 0 0 0 0 Transfers and Irrigation Total Development 227,188,894 665,611,142 698,891,710 733,836,284 Acquisition of Non- Health Services 609,596,132 748,444,409 785,866,629 825,159,961 Financial Assets and Emergency Other Capital Grants and Services 0 0 0 0 Transfers 37 Approved Estimates Projected Estimates Details Expenditure 2018/19 2019/20 2020/21 County Entity 2017/18 Total Development 609,596,132 748,444,409 785,866,629 825,159,961 Acquisition of Non- Transport, 614,341,530 1,133,897,233 1,190,592,095 1,250,121,699 Financial Assets Roads, Public Other Capital Grants and Works and 205,065,000 302,400,000 317,520,000 333,396,000 Transfers Housing Total Development 819,406,530 1,436,297,233 1,508,112,095 1,583,517,699 Acquisition of Non- 18,970,000 235,000,000 246,750,000 259,087,500 Education , Financial Assets Youth and Other Capital Grants and 0 54,295,000 57,009,750 59,860,238 Social Welfare Transfers Total Development 18,970,000 289,295,000 303,759,750 318,947,738 Land, Urban Acquisition of Non- 206,061,879 1,054,320,500 1,107,036,525 1,162,388,351 Development, Financial Assets Energy and Other Capital Grants and 0 0 0 0 Natural Transfers Resources Total Development 206,061,879 1,054,320,500 1,107,036,525 1,162,388,351 Tourism, Acquisition of Non- 15,821,362 6,872,102 7,215,707 7,576,493 Culture, Sports Financial Assets and Co- Other Capital Grants and 9,568,268 8,046,681 8,449,015 8,871,466 operative Transfers Development Total Development 25,389,630 14,918,783 15,664,722 16,447,959 Acquisition of Non- 6,014,148 2,014,855 2,115,598 2,221,378 Financial Assets County Public Other Capital Grants and Service Board 0 0 0 0 Transfers Total Development 6,014,148 2,014,855 2,115,598 2,221,378 Acquisition of Non- 241,000,000 236,000,000 127,600,000 140,360,000 Financial Assets County Other Capital Grants and Assembly 0 0 0 0 Transfers Total Development 241,000,000 236,000,000 127,600,000 140,360,000 TOTAL 2,988,251,929 4,600,802,922 4,683,343,079 4,923,890,224 38 Annex 4: Programme Based Expenditure in the Medium Term i. Recurrent Expenditure Projections County Entity Printed Estimates 2018/19 2019/20 2020/19 Office of the Governor 605,718,697 636,004,632 667,804,863 P01 Administrative Services. 401,503,989 421,579,188 442,658,148 P02 Transport Services. 30,177,780 31,686,669 33,271,002 P03 Human Resource Services 78,990,300 82,939,815 87,086,806 P04 Information Communication Services 10,844,956 11,387,204 11,956,564 P05 Hospitality Services. 22,811,866 23,952,459 25,150,082 P06 Cabinet Office. 7,969,500 8,367,975 8,786,374 P07 Deputy Governor, Advisors and County Secretary. 53,420,306 56,091,321 58,895,887 Public Service, Labour and ICT. 433,735,959 455,422,757 478,193,895 P01 Administration and Support Services. 424,510,959 445,736,507 468,023,332 P02 Information, Communication Services and ICT Infrastructure 5,975,000 6,273,750 6,587,438 P03 Training, Research and Development 3,250,000 3,412,500 3,583,125 Trade, Economic Planning and Industrialization. 135,110,600 141,866,130 148,959,437 P01 Administrative Services 82,585,600 86,714,880 91,050,624 P02 Legal Services 52,525,000 55,151,250 57,908,813 Finance and Revenue Management. 393,941,268 413,638,331 434,320,248 P01 Resource Mobilization. 26,127,351 27,433,719 28,805,404 P02 Budget Formulation, Coordination and Implementation. 55,987,728 58,787,114 61,726,470 P03 Supply Chain Management. 4,058,000 4,260,900 4,473,945 P04 Accounts Services. 7,736,042 8,122,844 8,528,986 P05 Audit Services. 5,850,000 6,142,500 6,449,625 P06 Human Resource Management and Support Services. 294,182,147 308,891,254 324,335,817 Decentralized Units, County Administration, Environment and Solid Waste. 374,833,441 393,575,113 413,253,869 P01 Administrative and Support Services. 169,524,927 178,001,173 186,901,232 P02 Administration of field services and Management of security services. 181,418,514 190,489,440 200,013,912 P04 General Administration and Planning 3,340,000 3,507,000 3,682,350 P05 Environmental Management 50,000 52,500 55,125 P06 Solid Waste Management 18,500,000 19,425,000 20,396,250 P07 Sanitation Management 2,000,000 2,100,000 2,205,000 Agriculture, Livestock, Fisheries, 502,632,973 527,764,622 554,152,853 39 Projections County Entity Printed Estimates 2018/19 2019/20 2020/19 Water and Irrigation. P01 General Administration and Support Services. 65,000,622 68,250,653 71,663,186 P02 Crop Development and Management. 132,491,243 139,115,805 146,071,595 P03 Livestock Resources Management and Development. 58,478,670 61,402,604 64,472,734 P04 Fisheries Development. 16,256,104 17,068,909 17,922,355 P05 Veterinary Services. 66,287,057 69,601,410 73,081,480 P06 Agriculture Training Centre. 13,929,793 14,626,283 15,357,597 P07 Water Supply and Sewerage. 47,669,128 50,052,584 52,555,214 P08 Water Resources Management and Water Storage. 47,022,849 49,373,991 51,842,691 P09 Development and promotion of irrigation schemes. 5,562,474 5,840,598 6,132,628 P10 General Administrative and Support Services. 49,935,033 52,431,785 55,053,374 Health and Emergency Services. 3,545,367,364 3,722,635,732 3,908,767,519 P01 Headquarters General Administration and Planning. 3,227,301,364 3,388,666,432 3,558,099,754 P02 Curative Services. 288,300,000 302,715,000 317,850,750 P03 Preventive and Promotive Services. 12,790,000 13,429,500 14,100,975 P04 Emergency Services. 16,976,000 17,824,800 18,716,040 Transport, Roads, Public works and housing. 187,097,783 196,452,672 206,275,306 P01 Headquarters Administrative Services. 30,555,014 32,082,765 33,686,903 P02 Road Development, Maintenance and Management. 24,232,764 25,444,402 26,716,622 P03 Housing Development and Human Settlement. 2,500,000 2,625,000 2,756,250 P04 County Government Buildings. 56,735,608 59,572,388 62,551,008 P05 County Fleet Management. 73,074,397 76,728,117 80,564,523 Education, Youth and Social Welfare. 295,221,490 309,982,565 325,481,693 P01 Headquarters Administrative Services. 152,784,000 160,423,200 168,444,360 P02 Basic Education. 95,087,490 99,841,865 104,833,958 P03 Youth Development Services. 21,850,000 22,942,500 24,089,625 P04 Gender and Social Services. 25,500,000 26,775,000 28,113,750 Lands, Urban Development, Energy and Natural Resources. 97,200,337 102,060,354 107,163,372 P01 Administrative Services. 61,942,274 65,039,388 68,291,357 P02 Energy and Natural Resources. 35,258,063 37,020,966 38,872,014 Tourism, Culture and Sports, Co- operative Development and Marketing. 81,269,662 85,333,145 89,599,802 40 Projections County Entity Printed Estimates 2018/19 2019/20 2020/19 P01 General Administration and Support Services. 45,571,383 47,849,952 50,242,450 P02 Heritage & Culture. 306,880 322,224 338,335 P03 Management and development of Sports and sports facilities. 3,548,000 3,725,400 3,911,670 P04 Liquor Management. 2,596,914 2,726,760 2,863,098 P05 Tourism development and Marketing. 5,250,256 5,512,769 5,788,407 P06 Management of recreational Facilities 1,787,447 1,876,819 1,970,660 P07 Machawood. 3,674,160 3,857,868 4,050,761 P08 County Image Directorate. 1,500,000 1,575,000 1,653,750 P09 Co-operative Development. 17,034,622 17,886,353 18,780,671 County Public Service Board 41,397,784 43,467,673 45,641,057 P01 Human Resource and Administration 41,397,784 43,467,673 45,641,057 County Assembly 936,776,339 983,615,156 1,032,795,914 P01 HR, Administration and Coordination Services. 252,070,955 264,674,503 277,908,228 P02 Financial Management Services 33,105,281 34,760,545 36,498,572 P03 Legal, Library and Research Services 12,000,000 12,600,000 13,230,000 P04 County Assembly Service Board 31,500,000 33,075,000 34,728,750 P05 Legislative Services 286,414,903 300,735,648 315,772,431 P06 Procedure and Committee Services 154,335,200 162,051,960 170,154,558 P07 Budget Office Services 6,000,000 6,300,000 6,615,000 P08 Audit Committee Services 5,500,000 5,775,000 6,063,750 P09 Ward Office Services 70,850,000 74,392,500 78,112,125 P10 Other Transfers 85,000,000 89,250,000 93,712,500 RECURRENT TOTAL 7,630,303,697 8,011,818,882 8,412,409,826 ii. Development Expenditure Printed Estimates Projections County Entity 2018/19 2019/20 2020/21 Office of the Governor. 6,825,000 7,166,250 7,524,563 P01 Headquarters Administrative Services 6,825,000 7,166,250 7,524,563 Public Service, Labour and ICT 12,700,000 13,335,000 14,001,750 P01 General Administration and Support Services 1,700,000 1,785,000 1,874,250 P02 Information, Communication Services and ICT Infrastructure 11,000,000 11,550,000 12,127,500 Trade, Economic Planning and 91,575,000 96,153,750 100,961,438 41 Printed Estimates Projections County Entity 2018/19 2019/20 2020/21 Industrialization P02 Trade Development 51,000,000 53,550,000 56,227,500 P03 Industrial Development 40,000,000 42,000,000 44,100,000 P06 Legal Office. 575,000 603,750 633,938 Finance and Revenue Management 11,801,000 12,391,050 13,010,603 P01 Administrative Services Resource Mobilization 10,071,100 10,574,655 11,103,388 P04 Accounts Services. 700,000 735,000 771,750 P05 Audit Services 1,029,900 1,081,395 1,135,465 Decentralized Units, County Administration, Environment and Solid Waste 31,000,000 32,550,000 34,177,500 P01 General Administrative and Support Services 16,000,000 16,800,000 17,640,000 P04 Environmental Management 5,000,000 5,250,000 5,512,500 P05 Solid Waste Management 10,000,000 10,500,000 11,025,000 Agriculture, Livestock, Fisheries, Water and Irrigation. 665,611,142 698,891,699 733,836,284 P01 General Administration and Support Services. 2,000,000 2,100,000 2,205,000 P02 Crop Development and Management 50,000,000 52,500,000 55,125,000 P03 Livestock Resources Management and Development 2,500,000 2,625,000 2,756,250 P04 Fisheries Development 400,000 420,000 441,000 P05 Veterinary Services 22,000,000 23,100,000 24,255,000 P07 Water Supply and Sewerage 335,311,202 352,076,762 369,680,600 P08 Water Resources Management and Water Storage 42,000,000 44,100,000 46,305,000 P09 Development and promotion of irrigation schemes 144,034,578 151,236,307 158,798,122 P10 General Administrative and Support Services 67,365,362 70,733,630 74,270,312 Health and Emergency Services. 748,444,409 785,866,629 825,159,961 P01 Headquarters General Administration and Planning. 460,576,125 483,604,931 507,785,178 P02 Curative Services. 141,000,000 148,050,000 155,452,500 P03 Preventive and Promotive Services. 36,418,284 38,239,198 40,151,158 P04 Emergency Services. 110,450,000 115,972,500 121,771,125 Transport, Roads, Public works and housing. 1,436,297,233 1,508,112,095 1,583,517,699 P01 Headquarters Administrative Services 500,250 525,263 551,526 P02 Road Development, Maintenance and Management 1,319,221,983 1,385,183,082 1,454,442,236 P04 County Government Buildings 36,575,000 38,403,750 40,323,938 P05 County Fleet Management 80,000,000 84,000,000 88,200,000 Education, Youth and Social Welfare 289,295,000 303,759,750 318,947,738 P01 Headquarters Administrative 105,000,000 115,762,500 42 Printed Estimates Projections County Entity 2018/19 2019/20 2020/21 Services 110,250,000 P02 Basic Education. 10,000,000 10,500,000 11,025,000 P03 Youth Development Services. 174,295,000 183,009,750 192,160,238 Lands, Urban Development, Energy and Natural Resources 1,054,320,500 1,107,036,525 1,162,388,351 P01 Urban Planning and Development 1,018,320,500 1,069,236,525 1,122,698,351 P02 Energy and Natural Resources 36,000,000 37,800,000 39,690,000 Tourism, Culture and Sports, Co- operative Development and Marketing 14,918,783 15,664,722 16,447,958 P02 Heritage & Culture 772,800 811,440 852,012 P03 Management and development of Sports Facilities 0 - - P04 Liquor Management 3,171,040 3,329,592 3,496,072 P05 Tourism development and Marketing 1,723,680 1,809,864 1,900,357 P06 Management of recreational Facilities 282,662 296,795 311,635 P07 Machawood 2,368,400 2,486,820 2,611,161 P08 County Image Directorate 5,678,281 5,962,195 6,260,305 P09 Co-operative Development 921,920 968,016 1,016,417 County Public Service Board 2,014,855 2,115,598 2,221,378 P01 Human Resource and Administration 2,014,855 2,115,598 2,221,378 County Assembly 236,000,000 247,800,000 260,190,000 P01 HR, Administration and Coordination Services 41,000,000 43,050,000 45,202,500 P02 Legislative Services 195,000,000 204,750,000 214,987,500 DEVELOPMENT TOTAL 4 , 6 0 0 , 8 0 2 , 9 2 2 4,830,843,068 5,072,385,222 COUNTY TOTAL 12,231,106,619 12,842,661,950 131,348,448,74,9759,05,4084 8 43 Annex 5: County Sector Ceilings County Expend Sector 2018/2019 2019/2020 2020/2021 Departments iture Rec 17,034,622 17,886,353 18,780,671 Co-operative Dev’t 921,920 968,016 1,016,417 Development Total 17,956,542 18,854,369 19,797,088 Rec 124,765,727 131,004,013 137,554,214 Livestock & Dev’t 24,500,000 25,725,000 27,011,250 Agriculture Veterinary and Co- Total 149,265,727 156,729,013 164,565,464 operative Rec 211,421,658 221,992,741 233,092,378 Development Agriculture Dev’t 52,000,000 54,600,000 57,330,000 Total 263,421,658 276,592,741 290,422,378 Rec 16,256,104 17,068,909 17,922,355 Fisheries Dev’t 400,000 420,000 441,000 Total 16,656,104 17,488,909 18,363,355 Rec 103,629,411 108,810,882 114,251,426 Transport Dev’t 80,500,250 84,525,263 88,751,526 Total 184,129,661 193,336,144 203,002,951 Rec 2,500,000 2,625,000 2,756,250 Housing Dev’t - - - Total 2,500,000 2,625,000 2,756,250 Rec 56,735,608 59,572,388 62,551,008 Public Works Dev’t 36,575,000 38,403,750 40,323,938 Energy, Total 93,310,608 97,976,138 102,874,945 Infrastructure and ICT Rec 24,232,764 25,444,402 26,716,622 Roads Dev’t 1,319,221,983 1,385,183,082 1,454,442,236 Total 1,343,454,747 1,410,627,484 1,481,158,859 Rec 35,258,063 37,020,966 38,872,014 Energy Dev’t 36,000,000 37,800,000 39,690,000 Total 71,258,063 74,820,966 78,562,014 Rec 5,975,000 6,273,750 6,587,438 ICT Dev’t 11,000,000 11,550,000 12,127,500 Total 16,975,000 17,823,750 18,714,938 Rec 82,585,600 86,714,880 91,050,624 Trade Dev’t 51,000,000 53,550,000 56,227,500 Commercial, Tourism and Total 133,585,600 140,264,880 147,278,124 Labour Affairs Industrializatio Rec - - - n Dev’t 40,000,000 42,000,000 44,100,000 44 County Expend Sector 2018/2019 2019/2020 2020/2021 Departments iture Total 40,000,000 42,000,000 44,100,000 Rec 60,380,160 63,399,168 66,569,126 Tourism Dev’t 13,224,063 13,885,266 14,579,529 Total 73,604,223 77,284,434 81,148,656 Rec 3,545,367,364 3,722,635,732 3,908,767,519 Health Health Dev’t 748,444,409 785,866,629 825,159,961 Total 4,293,811,773 4,508,502,362 4,733,927,480 Rec 247,871,490 260,265,065 273,278,318 Education, Youth and Education Dev’t 115,000,000 120,750,000 126,787,500 Social Welfare Total 362,871,490 381,015,065 400,065,818 Rec 21,850,000 22,942,500 24,089,625 Youth Dev’t 174,295,000 183,009,750 192,160,238 Total 196,145,000 205,952,250 216,249,863 Rec 3,548,000 3,725,400 3,911,670 Sports Dev’t - - - Total 3,548,000 3,725,400 3,911,670 Rec 25,500,000 26,775,000 28,113,750 Social Welfare Dev’t - - - Total 25,500,000 26,775,000 28,113,750 Rec 306,880 322,224 338,335 Culture Dev’t 772,800 811,440 852,012 Total 1,079,680 1,133,664 1,190,347 Rec 605,718,697 636,004,632 667,804,863 Office of the Dev’t 6,825,000 7,166,250 7,524,563 Governor Total 612,543,697 643,170,882 675,329,426 Rec 393,941,268 413,638,331 434,320,248 County Dev’t 11,801,000 12,391,050 13,010,603 Treasury Total 405,742,268 426,029,381 447,330,850 Public Rec 427,760,959 449,149,007 471,606,457 Administration Public Service Dev’t 1,700,000 1,785,000 1,874,250 Total 429,460,959 450,934,007 473,480,707 Rec 41,397,784 43,467,673 45,641,057 County Public Dev’t 2,014,855 2,115,598 2,221,378 Service Board Total 43,412,639 45,583,271 47,862,434 Decentralized Rec 169,524,927 178,001,173 186,901,232 45 County Expend Sector 2018/2019 2019/2020 2020/2021 Departments iture Units Dev’t 16,000,000 16,800,000 17,640,000 Total 185,524,927 194,801,173 204,541,232 Rec 237,283,514 249,147,690 261,605,074 County Dev’t 575,000 603,750 633,938 Administration Total 237,858,514 249,751,440 262,239,012 Rec 936,776,339 983,615,156 1,032,795,914 County Dev’t 236,000,000 247,800,000 260,190,000 Assembly Total 1,172,776,339 1,231,415,156 1,292,985,914 Rec 144,627,010 151,858,361 159,451,279 Water Dev’t 444,676,564 466,910,392 490,255,912 Water and Total 589,303,574 618,768,753 649,707,190 Irrigation Rec 5,562,474 5,840,598 6,132,628 Irrigation Dev’t 144,034,578 151,236,307 158,798,122 Total 149,597,052 157,076,905 164,930,750 Rec 61,942,274 65,039,388 68,291,357 Urban Dev’t 1,018,320,500 1,069,236,525 1,122,698,351 Land, Development Environment Total 1,080,262,774 1,134,275,913 1,190,989,708 and Natural Rec 20,550,000 21,577,500 22,656,375 Resources Environment and Natural Dev’t 15,000,000 15,750,000 16,537,500 Resources Total 35,550,000 37,327,500 39,193,875 13,484,795,04 Total County Budget. 12,231,106,619 12,842,661,950 7 46 Annex 6: Machakos County Budget Calendar 2018/19 No. ACTIVITY RESPONSIBILITY DEADLINE 1. Issue guidelines for preparation of County Executive 30th August 2018 2019/20 and Medium Term County Committee Member for Budget Estimates Finance 2. Submission of Annual Development CECM Planning 1st September, Plan (ADP) to the County Assembly for 2018 approval 3. Publish and Publicize Annual CECM Planning 8th September, Development Plan 2018 4. Expenditure Reviews CECM responsible for 10th September , Planning 2018 5. Draft County Budget Review and County Treasury 15th September Outlook Paper (CBROP) 2018 6. Submission of CBROP to the County County Executive 30th September Executive Committee Committee Member for 2018 Finance 7. Deliberation and approval of CBROP County Executive 14th October by the County Executive Committee Committee 2018 8. Submission of approved CBROP to County Treasury 21st October County Assembly 2018 9. Issue guidelines for reviewing County Treasury 30th October, 2018/2019 County Budget 2018. (Supplementary ) 10. Public Participation County Treasury 31st January, 2019 11. Draft County Fiscal Strategy Paper County Treasury 15th January (CFSP) circulated to stakeholders 2019 12. Submission of the CFSP to County County Treasury 28th February, Assembly 2019 13. Submission of Debt Management County Treasury 28th February, Strategy to County Assembly 2019 14. Publish and Publicize CFSP County Treasury 7th March, 2019 47 No. ACTIVITY RESPONSIBILITY DEADLINE 15. Adoption of CFSP County Assembly 14th March, 2019 16. Submission of budget Estimates for All Accounting Officers 15th March, 2019/20 to County Treasury 2019. 17. Consolidation of budget estimates for County Treasury 30th March, FY 2019/20 2019. 18. Submission of County Budget County Executive 15th April, 2019 Estimates and other supporting Committee Member for documents to County Executive Finance ( CECMF) Committee. 19. Submission of County Budget County Executive 30th April, 2019 Estimates and other supporting Committee Member for documents to County Assembly Finance ( CECMF) 20. Submission of Cash flow projections to All Accounting Officers 20th May, 2019 County Treasury 21. Submission of Cash flow projections to County Treasury 15th June, 2019 Controller of Budget, Intergovernmental Budget and Economic Council and the National Treasury 22. Approval of the Budget Estimates County Assembly 30th June 2019. 23. Publish and Publicize Budget Estimates County Treasury 21st July, 2019 24. Submission of Finance Bill to County CEC Finance Assembly 25. Approval of Finance Bill County Assembly 90 Days after Appropriation Bill approval 48 Annex 7: County Sector Composition Sector County Departments Agriculture and Cooperative Development  Livestock & Veterinary  Agriculture  Fisheries  Co-operative Development Energy, Infrastructure and ICT  Energy  Transport  Housing  Public works  Roads  ICT Commercial , Tourism and Labour affairs  Trade  Industrialization  Tourism  Investment  Labour Health  Health Education , Youth and Social welfare  Education  Youth  Social welfare  Culture  Sports Public Administration  Office of the Governor  County Treasury  Economic Planning  Public Service  County Image  Legal Office  County Public Service Board  Decentralized Units/County Administration  County Assembly Land , Environment and Natural Resources  Lands  Urban Development  Environment  Natural Resources Water and Irrigation  Water  Irrigation 49